May 27, 2019
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Facebook's opportunity in groups

By Laura Forman

New York (USA), May 7 (efe-epa).- Groups, apparently, are meaningful for Facebook's users, but not for the company's bottom line. Changing that could be lucrative, though not easy, according to a Dow Jones Newswires report made available to EFE on Tuesday.

Over the last two months, Facebook has made it clear that user privacy will be paramount to its future. In a March blog post, Chief Executive Officer Mark Zuckerberg outlined six focal points for Facebook going forward, all revolving around the user.

Similarly, at last week's annual F8 developer conference, Zuckerberg's keynote focused entirely on the consumer, announcing a major redesign favoring private Groups over public spaces like Newsfeed.

Investors have therefore heard a lot about how Facebook is investing to better protect its users' privacy. But missing from Zuckerberg's missives is just how Facebook plans to capitalize on this landmark change.

Facebook derives 99 percent of its revenue from advertisers but says it currently doesn't have ads within Groups.

Corralling users into Groups could make ad targeting easier as the groups can be defined by race, geography, stage of life, and hobbies.

With increased privacy regulation limiting what data Facebook can pass along to advertisers, grouping users on their own accord could be viewed as a clever way to circumvent regulation.

While the company declined to comment on future plans for ads within Groups, the potential advantages of running them suggest change could come soon.

But users may feel otherwise. Many groups are based on private practices of individuals, like religion, political preferences or vices they hope to kick.

Running ads across a confidential forum might feel intrusive and even dissuade users from engaging in the platform entirely.

Groups are very popular, though. Facebook says that 61 percent of its 2.3 billion users across all platforms interact with Groups monthly.

Of those, 29 percent say they belong to a group they find meaningful, according to the company, indicating potential sensitivity.

Facebook has some work to do making sure people are directed to groups that are relevant to them. A search of "cancer" within Groups run by The Wall Street Journal returned a group with 96,000 members blaming pharmaceutical companies and the United States government for furthering the spread of the disease, presumably not what most searchers are looking for.

Facebook is currently suggesting this writer join an "I Hate Cilantro Group" (I love cilantro), "Physician Side Gigs" (I'm not a doctor), and "Dudes With Dogs" (I'm a female), among other groups. Clearly, their recommendation algorithm can stand to improve.

Ultimately, it seems Facebook can't ignore this opportunity to grow ad dollars, particularly as it makes communities an increasing focal point for its legacy platform.

In addition, as users spend more time within Groups, ads run on their Newsfeeds will become that much less effective. But like the plan to eventually introduce ads within WhatsApp, which users love for its privacy and encryption, the line between monetization and user satisfaction will be controversial.

A simple Facebook search for "stop ads" returns many dedicated groups.

dj/hh

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